FM Global

About FM Global

If you're looking to protect your corporation, turn your insurance dial to FM Global. Factory Mutual Insurance (operating as FM Global) provides commercial and industrial property/casualty insurance and a variety of risk management services. It provides specialized products for ocean cargo and machinery equipment, as well as property loss prevention – more...engineering and research. FM Global operates through such subsidiaries as Affiliated FM Insurance, FM Global Cargo, and Mutual Boiler Re. In addition to the Americas, the company has offices throughout Europe, the Middle East, Africa, and the Asia/Pacific region.

About 97% of the company's revenue is derived from its FM and Affiliated FM lines. The remainder is produced by Mutual Boiler Re and FM Global Cargo.

FM Global operates a business model that promotes proactive loss prevention rather than actuarial loss predictions. The company helps its clients improve and strengthen facilities, minimizing the damage that can result from such events as fires, explosions, and hurricanes. Its engineering expertise is provided by FM Global Research Campus, housed in a research and testing complex in West Glocester, Rhode Island. The company's TSB Loss Control Consultants business provides emergency response training for its customers. A new facility, the FM Global Center for Property Risk Solutions, with its SimZone for providing experiential learning for engineers, was opened outside of Boston in 2011. The center also holds scientific research and development operations, a product-testing and certification division, and enterprise learning classrooms.

In its goal to spread its services globally, the company is carefully entering new markets, and introducing new activities in its existing markets. (After adding more engineering and insurance staff in Europe and South America, a third of the company's staff was based outside of North America by 2010.) One of FM Global's goals is to help its multinational customers avoid business interruption from substandard construction or protocols in countries where the local regulations are lax. Another initiative the company has identified as key to its success is stepping up cost-effective risk improvements on a seamless global platform. Additionally, the firm is seeking approval of its insurance license in China, and it is building client relations through such enhanced online improvements as client-based training and podcasts.

In 2011 hard-hitting and frequent natural disasters all over the world caused the company to experience its worst year for losses on record. FM Global's losses over 2010 increased by more than $1 billion from floods in Thailand and Australia, tornadoes in Alabama and Missouri, earthquakes in Japan and New Zealand, and other disasters. The losses contributed to the depletion of its policyholder surplus by more than 5% to $6.9 billion. Net losses for the year were $41.5 million compared to income gains of $686.6 million in 2010. Even so, FM Global's 96% client retention rate reached a 10-year high for the company, and it achieved a 5% increase in earned premiums to $3.2 billion, its revenue grew by 5% to $3.6 billion; and its assets grew by 7% to $15.3 billion.

FM Global counts among its policyholder-owners more than a third of FORTUNE 1000-sized companies throughout the world. Many, including Mohawk Fine Papers, MeadWestvaco, and Ascension Health, have long-standing relations with the company across decades. – less